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The Million Dollar Question Is What To Offer To Get An Accepted Bid For A Property
As an agent over 12 years, a question often buyers ask me is, what is the average discount from the asking price a buyer can offer for a home? My answer to this common question is that there is actually no average or magic formula. All properties are not the same and there are always multiple factors to consider.
These are the most common scenarios to consider:
Brand new listings in the market with already multiple offers: If a new listing has hit the market and it has multiple offers within the first week or first day of being listed, this is telling that the price and perhaps the condition, location, or features of the home are very attractive to multiple buyers. The listing is attractive enough to submit an offer for the property right away. When this happens, it is highly probable that the property may sell for asking price or even higher that asking price. If you are working with a season agent they can do a Comparative Market Analysis (CMA) for you but you will have to act quickly if this is the home you want to buy. Also, keep in mind that for new listings, even if there are no offers at the moment, most sellers are not willing to negotiate much from the asking price since they are normally new in the process and have high hopes to get an offer close to what they are asking. In this case your agent can again help preparing a CMA so you know if the property is priced right, underpriced or overpriced.
Property has been in the market for over 4 months: Most properties priced right take about 4 months to sell depending on the area and condition of the home. If the listing has been in the market over 4 months, this is where you might be able to get the better deal. Again, have your agent prepare a CMA. This is where you can come in lower, but you have to be careful, if you go too low, you may not get a response from the seller. You may also get the seller on a negative attitude towards you as a buyer and if another buyer enters negotiations, they may be more open to negotiate with that other buyer.
Listing that experienced a substantial price reduction: In this case, the price reduction may prompted offers and you have to be aggressive with your offer if you truly want the house. If there are no offers, I still recommend you try to go close to the asking price to get the property off of the market quickly. It is way better to negotiate a home that is priced well quickly, before other buyers start competing against you.
Buying during high selling season vs. buying during slow selling season: Buying during high selling season, typically Spring and Summer in most areas, is a bit more challenging. A lot more buyers are on the hunt for a home and the inventory of homes for sale may not have caught up with the demand for homes. Some buyers need to experienced the lost of a couple of offer bids before they realize they have to send more realistic offers during this time of the year. This should not be you! Again, listen to your agent. Once your agent looks at the market data they can tell you if property is priced right, below or higher than market value so you can make an informed decision on the home of your dreams.
Buying a home is a complex process and you should use the assistance of a professional who can guide you through the process. Even if you have bought properties in the past, keep in mind that the real estate market is dynamic and it changes, thus an active agent can let you know what is going on at the precise time frame you need to buy. Best of luck to you in bidding for a home and if you are in the area give me a call.
Realtor, ePro, CDPE, Lead Buyer Specialist
Michael Valdes & Associates
Keller Williams Realty
Janeth is dedicated to providing her clients with only the highest standards for customer service. She takes pride on being an expert in bringing home buyers and home sellers together throughout the T....
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